If you haven’t found the home of your dreams yet, don’t panic. This summer is a great time to finally make that investment, but it’s not over yet. You’ll be pleased to know that it’s still a smart time to buy a home, and this won’t be changing anytime soon. In fact, you may see lending standards loosen up in order to promote homeownership. Here are some trends to watch for this summer and early fall, especially as you narrow down your search.
Mortgage Rates Are STILL Low
Mortgage rates are still at historic lows because the economy isn’t improving as fast as we thought. It’s predicted by the Mortgage Bankers Association that a 30-year fixed rate could average 4.9 percent by the third quarter and reach 5 percent by the end of 2014. Only time will tell, but the good news is that you can lock in a low interest rate if you buy in 2014.
Lending Standards Are Not So Tight
Lending standards aren’t as tight as they once were, although they are still stricter than during the housing boom. Still, it’s important to boost homeownership rates, and for this reason, lenders are becoming more flexible and willing to listen to borrowers on common-sense issues. This includes accepting lower credit scores for both FHA and conventional loans.
Discounts on FHA Loans
FHA loans have become more popular, but the cost of mortgage insurance has made these loans an obstacle for many buyers. The FHA recently announced that they would be willing to lower the cost of mortgage insurance for buyers who are willing to go through a home counseling program before buying a home. The program isn’t in effect yet, but the discount that it would allow for is promising. Buyers would be silly not to take advantage of it.
Home Prices Aren’t Rising Fast
Even though house prices are rising steadily, they aren’t going up as fast as we thought. Spring was particularly slow, so if you are in the position to purchase a home now, you can enjoy low mortgage rates and low housing prices. At this time, there is a demand for homes, and inventory is low. This can make it more challenging to find your dream home, but it’s certainly not impossible. With the right realtor, you can find homes that fit your vision as soon as they come onto the market.